The last stand of Italy's bankrupt political class

A deal with the devil Berlusconi may shore up this dictatorship of the bourgeoisie. Can it last in a land pulsing with atomised rage?

Silvio Berlusconi waves to supporters outside his residence in Rome on Saturday 27 April 27. 'Berlusconi has nothing to lose and will wield tremendous power, not to mention continuing to shield himself from the law.' Photograph: Aptn/AP

On Sunday a new government was formed in Italy. Led by Enrico Letta, a moderate member of the Partito Democratico (PD), it is the first "grand coalition" the country has seen since the signing of the postwar constitution in 1947. Commentators have already pointed to other firsts: the youngest cabinet in Italian history (average age 53); that with the highest proportion of female ministers (a third); and the first black minister (Cécile Kyenge, the minister for integration, whose appointment has already drawn racist comments from the Northern League). Yet despite the veneer of novelty, Lampedusa's dictum from his novel The Leopard still sums up Italy's predicament: "If we want things to stay as they are, things will have to change." To grasp why, a little history is in order.

The new government was effectively imposed by Italy's octogenarian president Giorgio Napolitano, who was returned to an extraordinary second seven-year term in office by the implosion of the PD during the parliamentary presidential voting. Having failed to get the Christian Democrat trade unionist Franco Marini appointed in the first two votes, after dissent from its left wing – and in the face of the inspired proposal of Beppe Grillo's Five Star Movement to make the progressive jurist Stefano Rodotà its own candidate – the PD had a paper majority to elect Romano Prodi, the only politician its camp has produced in the past 20 years who has actually defeated Berlusconi.

But 101 of its members – "defectors" – killed the candidacy in a secret ballot. Napolitano, who had already enabled the appointment as prime minister of Mario Monti after Berlusconi's exit over a looming sovereign debt crisis, then returned under the sign of national emergency, with the moral authority to demand a "government of the president".

Far from a turnaround, this is in many ways the logical conclusion of Napolitano's political career: having joined the Italian Communist party after the collapse of fascism, he has always been a strong proponent of a "historical compromise": an alliance between communists and Christian Democrats to overcome economic crisis and political turmoil. This was an ill-conceived idea in its own time, and today a left-right compromise looks like nothing but a ruse to salvage a political class buffeted by Grillo's digital populism and widespread public contempt.

The orchestrators of the coup in the PD that gave Napolitano the power to form a government (many suspect the machinations of Massimo D'Alema, whose cynical dealings with Berlusconi are a matter of record) clearly wished to see off the challenge of Grillo's Five Star Movement, and chose to consolidate the implicit left-right alliance that already supported Monti's austerity government. Berlusconi was recast as the lesser evil, even if for the bulk of the PD's supporters – some of whom have taken to burning their membership cards – this is a pact with the devil. Berlusconi has effectively forced his opponents to acquiesce to his conditions – including renegotiating the IMU property tax and appointing his second-in-command, Angelino Alfano, as minister of the interior. All this while "il Cavaliere" is still facing plural indictments.

This government is the last stand of a political class that is unable to generate a concerted, popular and legitimate vision of Italy's path through and out of the crisis. Like the Monti government, it could be termed a dictatorship of the bourgeoisie: a government with no popular mandate, to rule for a limited if ill-defined period, and whose principal task is kick-starting an economic recovery defined not in terms of social needs but "growth": profit-making and exploitation.

Though pious noises are made about youth unemployment and insecurity, it will no doubt continue with the recipe that has been rolled out over the past 20 years: privatisations and reforms that make capital more predatory and labour more insecure. The spread in government bond yields between Italy and Germany, which seems to have become the sole cipher of our political future, appears already to be decreasing, though, so all must be well.

Fabrizio Saccomanni, the new minister of the economy – also director of the Bank of Italy, an architect of the Maastricht treaty and former employee of the IMF – tells us, with unshaken economic idealism, that it's all a matter of restoring "confidence", and that his priority will be helping businesses and the weakest members of society. How he plans to square that circle is not clear in a southern Europe gripped by crisis: the remedy is just more of the disease, with the inevitable consequences for political legitimacy and social conflict that we've already witnessed in Greece.

Will this government last? It's difficult to say. The PD can barely face its own members and after the recent shambles it risks the fate of the Greek Pasok. Berlusconi has nothing to lose and will wield tremendous power, not to mention continuing to shield himself from the law. Grillo and the Five Stars may capitalise on the government's intransigence, now that the party system has proven itself to be as cravenly cynical as they had always claimed.

Outside the walls of power of what Pasolini castigated as il Palazzo, there is an angry and anxious country. Atomised rage has already manifested itself with a man shooting two carabinieri outside the prime minister's residence during the swearing in. The only hope now lies in those movements that will be able to socialise that rage to fight for the public good and common needs, and not to reproduce a system that is so desperately and disastrously trying to reproduce itself.